October 18, 2013

MOBILE CREDIT CARD PROCESSING FOR DUMMIES

Strange that someone who still possesses a "dumb phone" should be writing about processing credit cards on a mobile device! But credit card acceptance is a necessity for all businesses today, from doctors to convenience stores. And, having the ability to process a customer transaction on a mobile phone provides even micro businesses with critical credit card acceptance ability.

Merchant service companies can now convert smartphones and tablets into mobile credit card acceptance portals with little effort or additional investment. For mobile businesses or many home businesses, the ability to accept credit cards via a mobile phone saves time and makes money. Not only is this a very efficient way for your business to get paid, but it also saves your customers the time, money and effort involved in paying your invoice at the end of the month. Examples of the types of businesses for whom mobile credit card processing is an asset include hair stylists, landscapers, house and carpet cleaners, mobile food trucks, outside sales representatives, farmers’ market merchants, and many more. This innovation has resulted in decreased exposure to credit card fraud, PCI non-compliance, charge backs and the added costs of “keyed” transaction fees.

After deciding what processor you want to use, you will be required to complete a merchant application. Upon acceptance of the application, the business owner will be able to download the mobile app and secure log-in credentials allocated for the business’ depository bank account. A card reader will plug into the audio jack of your mobile device to swipe customer cards, which will populate the mobile app with the cardholder information. All the business has to do is swipe the customer’s card right on the smartphone, have the customer sign on the touchscreen, and then email the customer a copy of their receipt. Your cell phone,accompanied by a mobile credit card processing service, will provide real-time validation and payment processing, low rates, online account management, and the ability to email or text receipts back to your customers.

Businesses should carefully examine the fee structure of the processor. Typically, you will be charged set-up fees to start, monthly service fees, and transaction fees every time you process a credit card. Transactions fees are typically composed of two elements, the base rate and the processing rate. Note that one service may have a low per-transaction fee, but the authorization rate may be high.

Most apps will work with any popular mobile phone. Every major service uses SSL encryption to be sure that sensitive information is secure. Individual apps are typically password protected and include additional safety measures in the event of theft or loss of the device. Credit card informationis never actually stored on the phone. These payments are typically safer than other methods of credit card acceptance because the card never leaves the customer’s sight and there are no imprinted receipts containing customer credit card information.